LIHTC Financial Management & Tax Credit Allocation

Question 1

What is the role of financial management in LIHTC projects?

Accepted Answer

To manage budgeting and credit allocation

Answer

To ignore expenses.

Answer

To increase project costs.

Answer

To delay payments.

Question 2

Who allocates tax credits to projects in California?

Accepted Answer

CTCAC

Answer

Federal government.

Answer

Tenants.

Answer

Local housing authorities.

Question 3

What is an eligible basis in LIHTC financial management?

Accepted Answer

Development costs eligible for credits

Answer

Marketing costs.

Answer

Employee salaries only.

Answer

Utility bills.

Question 4

How are tax credits typically claimed by investors?

Accepted Answer

Over 10 years

Answer

All at once.

Answer

Only in the first year.

Answer

Not claimed at all.

Question 5

What financial reports are required for LIHTC projects?

Accepted Answer

Regular financial reports

Answer

No reports required.

Answer

Only tax filings.

Answer

Only sales reports.

Question 6

What happens if financial mismanagement is detected in LIHTC projects?

Accepted Answer

Penalties and credit recapture

Answer

No action.

Answer

Additional credits granted.

Answer

Project is ignored.

Question 7

How does proper tax credit allocation benefit LIHTC projects?

Accepted Answer

Supports project viability

Answer

Creates confusion.

Answer

Delays construction.

Answer

Increases taxes.

Question 8

Who typically invests in LIHTC projects?

Accepted Answer

Private investors

Answer

Only government agencies.

Answer

Tenants.

Answer

Banks only.

Question 9

What is the purpose of syndication in LIHTC?

Accepted Answer

To raise capital through credit sales

Answer

To reduce project costs.

Answer

To delay financing.

Answer

To increase rents.